REG - Rightmove Plc - Final Results <Origin Href="QuoteRef">RMV.L</Origin> - Part 5
24/02/2017 07:06
- Part 5: For the preceding part double click ID:nRSX7347Xd
Financial targets will determine vesting in relation to at least half of an award.
25% of the awards vest for achieving the threshold performance target. Awards vest
on a linear basis from threshold to maximum performance levels.
The performance period for financial targets and relative TSR targets is three
financial years, starting with the year in which the award is granted.
All-employee Sharesave Plan Provides all employees with the opportunity to become owners in the Company on similar terms. Executive directors are entitled to participate on the same terms as all other employees in the Group's Sharesave Plan, which has standard terms. Participation limits are set by HMRC from time to time. None
Share Incentive Plan (SIP) To provide all employees the opportunity to own shares in the Company on equal terms. Executive directors are entitled to participate in the SIP on the same terms as all other employees. The SIP has standard terms and currently only free shares are offered. However, executive directors routinely forfeit their entitlement to any free share awards. The Committee may award free shares to employees, subject to the continued strong Group performance. Share awards will typically be made annually in January and will be modest in value, historically 50 shares per employee, although this will differ with the market value of the shares. Participation in the SIP is based on HMRC rules. Share awards are discretionary and made within the SIP rules. None
Share ownership guidelines To provide alignment between the executives and shareholders. Executive directors are required to retain at least half of any share awards vesting or exercised (after selling sufficient shares to meet the exercise price and to pay any tax liabilities due) until they have met the shareholding guideline. The Committee will regularly monitor progress towards the guideline. Shareholding guideline: 200% of base salary for all executive directors. Not applicable
Non-executive directors To provide a competitive fee which will attract and retain high calibre individuals and reflects their relevant skills and experience. The fees for non-executive directors (including the Company Chairman) are reviewed periodically (generally every three-years). The Committee will consider the Chairman's fee, whilst the non-executive directors' fee is considered by the wider Board, excluding the non-executives. Fee levels for each role are determined after considering the responsibility of the role, the skills and knowledge required and the expected time commitments. Periodic benchmarking against relevant market comparators, reflecting the size and complexity of the role, is used to provide context when setting fee levels. In exceptional circumstances, where the normal time commitment has been substantially exceeded, an additional fee may be paid at the Board's discretion. Fees for the Chairman and non-executive directors were last reviewed in 2015 and are set out on page 71. Fee increases may take place if fee levels are considered to have become out of line with the responsibilities and time commitments of individual roles. Flexibility is retained to increase the above fee levels in the event that it is necessary to recruit a new Chairman or non-executive director of an appropriate calibre in future years. None
Business expenses To reimburse directors for reasonable business expenses. Directors may claim reasonable business expenses within the terms of the Group's expenses policy and be reimbursed on the same basis as all employees. The Group may reimburse business expenses which are in future classified as taxable benefits by HMRC. Expenses vary from year to year according to each director's responsibilities, business activity and location. Not applicable
Discretions maintained by the Committee in operating the incentive plans
The Committee will operate the annual bonus plan, PSP, Sharesave Plan and SIP according to their respective rules and in
accordance with the Listing Rules and HMRC rules where relevant.
The Committee retains discretion, consistent with market practice, in a number of regards to the operation and
administration of these plans. These discretions include, but are not limited to, the following:
· the selection of participants in the respective plan;
· the timing of grant of an award (if any) and payments;
· the size of an award and/or a payment (with limits as described in the table above);
· the extent of vesting based on the achievement of performance targets and applicable exercise periods where relevant;
· how to deal with a change of control (e.g. the timing of testing performance targets) or restructuring of the Group;
· determination of a 'good'/'bad' leaver for incentive plan purposes based on the rules of each plan and the appropriate
treatment chosen including the timing of the delivery of shares;
· adjustments (if any) required in certain circumstances (e.g. rights issues, corporate restructuring events and special
dividends); and
· the annual review of performance measures, targets and weightings for the annual bonus plan and PSP from year to
year.
The Committee also retains the ability to adjust the targets and/or set different measures for the annual bonus plan and
PSP if events occur (e.g. a material divestment or acquisition) which cause it to determine that the conditions are no
longer appropriate and an amendment is required so that the conditions achieve their original purpose and are not
materially less difficult to satisfy.
Any use of the above discretions would, where relevant, be detailed in the Annual Report on Remuneration and if
appropriate, the subject of prior communication with the Company's major shareholders.
For the avoidance of doubt, all previous commitments or entitlements agreed prior to the approval of this Policy or
appointment to the Board will be permitted to payout on their original terms or in line with the Policy in force at the
time they were agreed.
Selection of performance measures and how targets are set
The performance metrics that are used for annual bonus and long-term incentive plans are a subset of the Group's key
performance indicators.
For the annual bonus, underlying operating profit before tax(1) is the primary performance metric used as it is aligned to
the Group's strategy of delivering profitable growth and is a key financial performance indicator used within the business.
Consistent with previous years, operating profit is measured on an underlying basis, to exclude any volatility in relation
to the Company's share price in connection with the IFRS 2 valuation and National Insurance charge on share-based
incentives granted. The underlying operating profit before tax(1) target is set on a sliding scale based around the
business plan for the year, with 25% payable for threshold performance.
The annual bonus also considers performance against other operational metrics, including a traffic market share target,
growth in Other revenue and an employee engagement target, for a minority of the bonus, with a sliding scale used to
determine performance against each measure.
Market share is a measure of the size and engagement of our audience and the value which Rightmove brings to our customers
and therefore a challenging target to increase Rightmove's share of this audience is considered appropriate by the
Committee.
The Other revenue target measures growth in revenue from businesses other than Agency and New Homes. Since some of these
businesses will be at an early stage of development, we consider growth in revenue rather than in operating profit to be
the appropriate measure and note that this element of the bonus is only a small proportion of the total bonus opportunity.
For the PSP, awards are subject to a combination of underlying basic EPS() (EPS) and relative TSR performance conditions.
EPS is considered the most appropriate financial metric for Rightmove at this stage in its development (since it is the
measure of profitability that is most closely aligned with shareholders' interests and monitored on an ongoing basis within
the business). The Policy also recognises that relative TSR should also be a performance measure in order for there to be a
clear alignment of executive and shareholder interests. EPS targets are set based on sliding scales that take account of
internal financial planning and external analyst forecasts. Only 25% of the EPS element will payout for threshold
performance levels, with the maximum award requiring substantial out-performance. For TSR, the range of targets measure how
successful the Company is in out-performing the FTSE 350 Index with 25% of this part of the award vesting at the threshold
performance level, through to full vesting for 25% out-performance of the Index over the three-year performance period.
For historic PSP awards, performance against the FTSE 250 Index was the selected measure, however, the Company has resided
in the top quartile of the FTSE 250 for some time and the wider index is now considered more appropriate for comparison
purposes.
Performance targets do not apply to Sharesave or SIP awards since these awards are structured to encourage employees to
become share-owners and to maintain tax-favoured status the awards must operate on a consistent basis for all employees.
The Company does not at the present time take account of the ratio of CEO to employee pay but will keep this under review
as market and best practice develops and as regulations evolve.
How the views of employees are taken into account
The Company has not to date felt it necessary to consult directly with employees on executive remuneration matters.
However, the Committee is kept aware of pay and employment conditions within the wider workforce when setting executive
directors' remuneration policy.
Remuneration policy for executive directors compared to other employees
The Committee will consider the proposed salary budget for the whole Group when it is deciding on salary increases for
executive directors specifically.
In line with the Company's strategy to keep remuneration simple and consistent, benefits and pension arrangements provided
to executive directors are the same as those offered to all Group employees.
The extent to which annual bonuses are offered varies by level of employee within the Group, with the quantum and
performance metrics used determined by the nature of the role and responsibilities and market rates at that level.
Long-term incentive awards such as the DSP, are only offered to senior management as those awards are more heavily weighted
towards performance-related pay and have a stronger visibility on the value created for shareholders and the reward for
participants.
Shareholders' views
The Committee considers it vitally important to maintain open and transparent communication with the Company's
shareholders. The Committee consulted major shareholders representing over 50% of the Company's share ownership on proposed
changes and continued suitability of the Remuneration Policy. The shareholders who were consulted were overwhelmingly
supportive of the Policy proposals and commented constructively in relation to several areas, including future rises in
basic salary and post-vesting holding periods for long-term incentives. Shareholder feedback was considered by the
Committee and contributed to the development of the overall Remuneration Policy.
Reward scenarios
The Company's reward policy (as previously outlined) is illustrated below using three different performance scenarios:
minimum, on-target and maximum:
Please refer to the pdf
http://www.rns-pdf.londonstockexchange.com/rns/7347X_-2017-2-23.pdf
Assumptions:
1. Minimum = fixed pay only (salary + benefits + pension).
2. On-target = 55% payable of the 2017 annual bonus and 62.5% vesting of the 2017 PSP awards being the midpoint between
threshold vesting of 25% and maximum vesting of 100%.
3. Maximum = 100% payable of the 2017 annual bonus and 100% vesting of the 2017 PSP awards.
Base salary is as set at 1 January 2017. The value of taxable benefits is based on the cost of supplying those benefits
(using the cost as disclosed on page 75) for the year ended 31 December 2016. The executive directors have elected not to
partcipate in the Company's pension arrangements.
The executive directors can participate in the Sharesave Plan and SIP on the same basis as other employees. The value that
may be received under these schemes is subject to tax approved limits. For simplicity, the value that may be received from
participating in these schemes has been excluded from the above charts.
As required by the regulations no assumption is made as to future share price growth for reward elements (deferred bonus
and long-term incentives) that are delivered in shares.
Amounts have been rounded to the nearest £1,000.
Recruitment and promotion policy
The Committee proposes an executive director's remuneration package for new appointments in line with the principles
outlined in the table below:
Element of remuneration Policy
Base salary Base salary levels will be set based on the roles and responsibilities of the individual together with their relevant skills and experience, taking into account the market rates for companies of comparable size and complexity and internal Company
relativities. In some circumstances (e.g. to reflect an individual's limited experience at a Plc board level) it may be considered appropriate to set initial salary levels below the perceived market competitive rate. Phased increases, potentially above
inflation, may then be offered to achieve the desired market positioning over time, subject to individual's continued performance and development in the role.
Benefits Benefits as provided to current executive directors. Where necessary the Committee may approve the payment of relocation expenses to facilitate recruitment, and flexibility is retained for the Company to pay legal fees and other costs incurred by the
individual in relation to their appointment.
Pension Defined contributions or a cash alternative at the level provided to current executive directors.
Annual bonus An annual bonus would operate in the same manner as outlined for the current executives (as described above and in the Annual Report on Remuneration), although it would be pro-rated to reflect the employment period during the bonus year. Flexibility will
be retained to set equivalent objectives for any new executive joining part way through a year. The maximum bonus potential would not exceed 125% of base salary. It would be expected that the bonus for a new appointment would be assessed on the same
performance metrics as that for the current executives on an ongoing basis. However, depending on the timing and nature of appointment it may be necessary to set tailored performance criteria for their first bonus plan.
Long-term incentives A new appointment will be eligible to receive PSP awards as outlined in the policy table. Share awards may be granted shortly after an appointment (subject to the Company not being in a close period) and would be measured against the same performance
criteria as the current executives. However, any award granted outside the normal award and performance cycle may be pro-rated at the Committee's discretion. The Committee may introduce post-vesting holding periods under the PSP for new executives if it
considers this an appropriate commitment in conjunction with the shareholding guidelines. The ongoing maximum award would not exceed 200% of base salary. For an internal hire, existing awards would continue over their original vesting period and remain
subject to their terms as at the date of grant. The new appointment would be eligible to participate in the Sharesave Plan and the SIP under the same terms as all other employees.
Buy-out awards To facilitate an external recruitment, it may be necessary to buy-out remuneration which would be forfeited on leaving their previous employer. When determining the quantum and structure of any buy-out awards the Committee will, as a minimum, take into
account the following factors:· the form of remuneration (cash or shares); · timing of expected payment/vesting; and · expected value (i.e. taking into account the likelihood of achieving the existing performance criteria). Buy-out awards,
if used, will be granted using the Company's existing share plans to the extent possible, although awards may also be granted outside of these schemes if necessary and as permitted under the Listing Rules.
Directors' service contracts and non-executive directors' terms of appointment
The Committee's policy on service agreements for executive directors is that they should provide for 12 months' notice of
termination by the Company and by the executive. Any proposals for the early termination by the Company of the service
agreements of directors, are considered by the Committee.
The service agreements for the executive directors allow for lawful termination of employment by making a payment in lieu
of notice or by making phased payments over any remaining unexpired period of notice. The phased payments may be reduced
if, and to the extent that, the executive finds an alternative remunerated position.
In addition, any statutory entitlements or sums to settle or compromise claims in connection with the termination would be
paid as necessary. The Company may also provide a contribution toward reasonable legal fees or outplacement services.
For Nick McKittrick a payment in lieu of notice will be related to base salary, benefits and projected annual bonus
pursuant to the Group's targets being achieved for the year (pro-rated for any unexpired period of notice where
appropriate). The Committee is aware that the provision of annual bonus with a payment in lieu of notice is no longer
considered in line with best practice. The provision within Nick McKittrick's contract is considered a legacy issue which
would not be repeated in any future director's service contract.
For Peter Brooks-Johnson and Robyn Perriss a payment in lieu of notice will be restricted to base salary and benefits. In
good leaver circumstances a bonus may be paid at the normal time subject to achievement of the performance conditions and
pro-rating for the period worked in the year.
For awards granted under the PSP 'good leaver' status may be determined, in certain prescribed circumstances, such as
death, ill health, disability, redundancy, transfer or sale of the employing company, or other circumstances at the
discretion of the Committee. If defined as a 'good leaver', awards will remain subject to performance conditions, which
will be measured over the performance period from grant to the original vesting date, unless the Committee determine to
assess performance from grant to the date of cessation, and which will be reduced pro-rata to reflect the proportion of the
performance period actually served. The Committee retains the discretion to disapply time pro-rating in exceptional
circumstances and to accelerate the vesting of awards for 'good leavers' in the event of death.
For awards granted under the DSP, 'good leaver' status may be determined for reasons of death, injury, disability,
redundancy, transfer or sale of the employing company or other circumstances at the discretion of the Committee. If defined
as a 'good leaver', awards will be retained and vest on the original vesting date, save as above in the event of death,
when the Committee has the discretion to accelerate vesting.
Scott Forbes' appointment may be terminated by either party giving to the other not less than three months' notice in
writing. The Company may also terminate by making a payment in lieu of notice. Scott Forbes is not contractually entitled
to any other benefits on termination of his contract.
The Letters of Appointment for the non-executive directors provide for a term of up to two three-year periods and a
possible further three-year term (subject to re-election by shareholders and subject to the director remaining
independent). The appointments may be terminated with a notice period of three months on either side and the Letters of
Appointment set out the time commitments required to meet the expectations of their roles.
Copies are available for inspection on request to the Company Secretary.
Further details of all directors' contracts and Letters of Appointment are summarised below:
Date of appointment Date of contract/Letter of Appointment(1) Notice (months) Length of service at
24 February 2017
Executive directors
Nick McKittrick 5 March 2004 7 February 2006 12 12 years 11 months
(Chief Executive Officer)(2)
Peter Brooks-Johnson(3) 10 January 2011 22 February 2011 12 6 years 1 month
Robyn Perriss(4) 30 April 2013 1 May 2013 12 3 years 10 months
Non-executive directors
Scott Forbes (Chairman) 13 July 2005 21 February 2006 3 11 years 7 months
Colin Kemp 3 July 2007 4 December 2007 3 9 years 7 months
Ashley Martin 11 June 2009 9 June 2009 3 7 years 8 months
Peter Williams 3 February 2014 3 February 2014 3 3 years 1 month
Rakhi Goss-Custard 28 July 2014 28 July 2014 3 2 years 7 months
Jacqueline de Rojas 30 December 2016 10 October 2016 3 2 months
(1) The service contracts and the Letters of Appointment for all directors appointed prior to 28 January 2008, were
transferred from Rightmove Group Limited to Rightmove plc with effect from this date on completion of a Scheme of
Arrangement under the Companies Act 1985.
(2) Nick McKittrick joined the Group in December 2000 and was appointed to the Board on 5 March 2004. His service with the
Group at the date of this report is 16 years and 2 months.
(3) Peter Brooks-Johnson joined the Group on 9 January 2006 and was appointed to the Board on 10 January 2011. His service
with the Group at the date of this report is 11 years and 1 month.
(4) Robyn Perriss joined the Group on 1 July 2007 and was appointed to the Board on 30 April 2013. Her service to the
Group at the date of this report is 9 years and 8 months.
External appointments
With the approval of the Board in each case, executive directors may accept one external appointment as a non-executive
director of another listed or similar company and retain any fees received. None of the executive directors currently hold
any outside directorships.
Annual Report on Remuneration
Remuneration Committee role and membership
Terms of reference
The primary role of the Committee is to make recommendations to the Board as to the Company's overall policy and framework
for the remuneration of the executive directors and the Chairman of the Board. The remuneration and terms of appointment of
the non-executive directors are determined by the Board as a whole.
In accordance with the Code, the Committee also recommends the structure and monitors the level of remuneration for the
first layer of management below Board level. The Committee is also aware of, and advises on, the employee benefit
structures throughout the Group and ensures that it is kept aware of any potential business risks arising from those
remuneration arrangements.
The Committee has formal terms of reference which are reviewed annually and updated as required. These are available on the
Company's website at plc.rightmove.co.uk or on request from the Company Secretary.
Membership
The following independent non-executive directors were members of the Committee during 2016. During the year the Committee
met six times and attendance at the meetings is shown below:
Committee Members Number of meetings attended
Peter Williams (Chairman of the Committee) 6
Colin Kemp 6
Rakhi Goss-Custard 6
The quorum for meetings of the Committee is two members. The Committee will meet at such times as may be necessary but will
normally meet at least five times a year. The Company Secretary acts as Secretary to the Committee.
Only members of the Committee have the right to attend Committee meetings. The Chairman of the Committee has requested that
the Chairman of the Board attend the meetings except during discussions relating to his own remuneration. The Chief
Executive Officer may also be invited to meetings and the Committee takes into consideration his recommendations regarding
the remuneration of executive colleagues and the first layer of management below Board level. No executive director is
involved in deciding their own remuneration.
External advisors
New Bridge Street (NBS), a trading name of Aon Hewitt (part of Aon plc), which is a member of the Remuneration Consultants
Group and has signed up to its Code of Conduct, has been retained as the Committee's remuneration advisor since 2011. The
terms of engagement between the Company and NBS are available from the Company Secretary on request.
The total fees paid to NBS in respect of services to the Committee during the year were £42,000.
During 2016 NBS also provided services to the Company in connection with the valuation of share-based incentives (as
required by IFRS 2) and confirmed that, in its view, these services did not present a conflict of interest with the other
services provided to the Committee. The Committee reviews its relationship with external advisors on a regular basis and
continues to believe that there are no conflicts of interest.
What has the Committee done during the year?
The Committee met six times during the year to consider and, where appropriate, approve key remuneration items including
the following:
Pay and incentive plan reviews
· annual review and approval of executive directors' base salaries and benefits;
· review of year-end business performance against relevant performance targets to determine annual bonus payouts and
vesting of long-term incentives;
· review and approval of appropriate benchmarks and performance measures for the annual performance related bonus and
2017 PSP awards to ensure measures are aligned with strategy and that targets are appropriately stretching;
· ongoing monitoring of senior management remuneration structures; and
· approval of share awards granted under the Deferred Share Bonus Plan (DSP) and the Rightmove Performance Share Plan
(PSP).
Governance and strategy
· review of the Remuneration Policy for executive directors and consultation with major shareholders on the proposed
policy before submitting it for shareholder approval at the 2017 AGM;
· review and approval of the 2016 Directors' Remuneration Report;
· review of the 2016 AGM voting and feedback from institutional investors;
· evaluation of the Committee's performance during the year; and
· review of the Committee's terms of reference.
Application of policy for year ending 31 December 2017
Salaries
The executive directors' salaries for the 2017 financial year are set out in the table below:
Salary1 January 2017 Salary31 December 2016 Workforce increase plus Change
Executive directors
Nick McKittrick £445,536 £424,320 3% 5%
Peter Brooks-Johnson £373,136 £355,368 3% 5%
Robyn Perriss £320,000 £281,112 11.8% 13.8%
The 5% increase in Nick McKittrick's and Peter Brooks-Johnson's salaries represents an increase of 3% above the average
workforce increase of 2% for 2017, primarily to recognise the scale and complexity of their roles and also to address the
relatively low pay of these executives compared with market norms. Robyn Perriss has been awarded an additional increase of
11.8% above the average all employee pay rise to reflect the lower starting salary awarded on her appointment to the Board
in her first role as a Finance Director and in recognition of the performance and capability she has demonstrated as she
has gained experience in that role. The salaries remain well below the market median for executives in comparable
companies.
On 24 February 2017 the Company announced the retirement of Nick McKittrick as Chief Executive Officer and the appointment
of Peter Brooks-Johnson as his successor, with effect from 9 May 2017. Further details are discussed on pages 83 to 84.
Pension and other benefits
The Group operates a stakeholder pension plan for employees under which the employer contributes 6% of base salary, subject
to the employee contributing a minimum of 3% of base salary. Peter Brooks-Johnson and Robyn Perriss participated in the
pension plan during the year. However, the executive directors have chosen not to participate in this arrangement in future
years. The Company does not contribute to any personal pension arrangements.
The executive directors are enrolled in the Group's private medical insurance scheme and receive life assurance cover equal
to four times base salary. Additionally, the executive directors are members of the Group's medical cash plan.
Annual bonus
The annual bonus for the 2017 financial year will be consistent with the policy detailed on page 59 of the Remuneration
Policy section of this report in terms of maximum bonus opportunity, deferral and clawback provisions. The mechanism
through which the clawback can be implemented (enabling both the recovery and withholding of incentive pay) enables the
Committee to (i) reduce the cash bonus earned in a subsequent year and/or reduce outstanding DSP/PSP share awards (i.e.
withholding provisions may be used to effect a recovery) or (ii) for the Committee to require that a net of tax balancing
cash payment be made to the Company. The performance measures have been selected to reflect a range of financial and
strategic targets that continue to support the key objectives of the Group.
The performance measures and weightings will be as follows:
Measure As a % of maximum bonus opportunity
Financial targetsUnderlying operating profit before tax(1) 65%
Strategic targetsTraffic market share(2)Other revenue(3)Employee engagement(4) 15%15%5%
(1) Operating profit before share-based payments and NI on share-based incentives.
(2) Measured on a time on site basis.
(3) Revenue excluding Agency and New Homes.
(4) Based on the results of the annual employee survey.
In relation to the financial target a challenging sliding scale will operate with 25% of the maximum bonus opportunity
payable at the threshold underlying operating profit target relative to the 2017 business plan through to 100% becoming
payable for significant outperformance relative to the plan. A greater proportion of the award will be paid for exceeding
on-target performance.
The weighting of all performance measures are unchanged from 2016.
The targets themselves, as they relate to the 2017 financial year, are deemed to be commercially sensitive. However,
retrospective disclosure of the targets and performance against them will be provided in next year's Annual Report on
Remuneration to the extent that they do not remain commercially sensitive at that time.
Long-term incentives
The award levels under the PSP, originally approved in 2014, remain at 200% of base salary for all executive directors.
Consistent with current market practice and previous years, awards to the executive directors under the PSP in 2017 will be
subject to a mixture of EPS (75% of awards) and relative TSR (25% of the awards) performance conditions. The 2017 targets
are as follows:
EPS performance condition
The Group's EPS growth will be measured over the period of three financial years (2017 to 2019). The EPS figure used will
be equivalent to the Group's basic underlying EPS (before share-based payments, National Insurance on share-based
incentives and no related adjustment for tax). With a view to ensuring appropriately stretching but achievable targets are
set in light of market expectations for the Group, the following range of targets will apply to the 2017 awards:
Underlying basic EPS growth from 2017 to 2019(1) % of award vesting(maximum 75%)
Less than 20% 0%
20% 18.75%
50% 75%
Between 20% and 50% Straight-line vesting
(1) The benchmark underlying basic EPS for the financial year 2016 from which these targets will be measured is 142.8p.
As in prior years, the targets that are intended to operate for the 2017 PSP awards were set to be appropriately demanding
in light of the Group's internal planning, external market expectations for future growth and the current trading
environment, the targets are considered to provide a realistic incentive at the lower end of the performance range but
require exceptional performance to achieve full vesting. On this basis, the Committee is satisfied that the range of
targets are appropriately demanding, and no less challenging than the range of targets set for 2016 awards.
Relative TSR performance condition
The vesting schedule for the relative TSR element of executive directors' 2017 PSP awards is set out below. Relative TSR
will be assessed against the FTSE 350 Index, reflecting the Company's size in terms of market capitalisation. Performance
will be measured over three financial years.
TSR performance of the Company relative to the FTSE 350 Index(1) % of award vesting(maximum 25%)
Less than the Index 0%
Equal to the Index 6.25%
25% higher than the Index 25%
Intermediate performance Straight-line vesting
(1) If the FTSE 350 Index's TSR was 50% over the three-year performance period, then the Company's TSR would have to be
at least 75% for all 25% of the PSP shares to vest.
Chairman and non-executive directors' fees
The Chairman and non-executive fees were last reviewed in a market context in 2015 and increased to current levels. In line
with our policy they will be reviewed periodically, usually every three-years, with the next increase anticipated in 2018.
The basic non-executive fee is £50,000 with an additional £10,000 fee per annum paid for the chairing of the Audit and
Remuneration Committees and a further £5,000 fee paid to the Senior Independent Director as detailed in the table below:
Annual fee 1 January 2017 Annual fee 31 December 2016
Scott Forbes (Chairman) £170,000 £170,000
Colin Kemp £50,000 £50,000
Ashley Martin £60,000 £60,000
Peter Williams £65,000 £65,000
Rakhi Goss-Custard £50,000 £50,000
Jacqueline de Rojas £50,000 £274(1)
(1) Fee for 2016 is for two days from her appointment on 30 December 2016.
Statement of shareholder voting at AGM
At the AGM on 5 May 2016, 94.91% of shareholders voted in favour of the Directors' Remuneration Report. The Committee
believes this illustrates the strong level of shareholder support for the remuneration framework. The table below shows
full details of the voting outcomes for the Directors' Remuneration Report:
Votes for % Votes for Votes against % Votes against Votes withheld(1)
Directors' Remuneration Report 77,382,308 94.91 4,146,773 5.09 879,511
(1) A vote withheld is not a vote in law and is not counted in the calculation of the proportion of votes cast 'For' and
'Against' a resolution
In line with the Company's commitment to ongoing dialogue with its shareholders, meetings are offered, where appropriate,
to understand the reasons for any potential or actual opposition to the Company's Remuneration Policy. Changes are made to
our Policy where it is considered appropriate to do so.
Review of past performance
Share price performance
In 2016, the Company's share price ended the year at £39.03 down 5.4% year on year (the FTSE 250 Index was up 3.7% and the
FTSE 350 Index was up 12.5%). On a three-year basis the share price has increased by 42.4% and has continued to outperform
both the FTSE 250 and FTSE 350 Indices over that period as shown in the graphs on page 73.
Total shareholder return (TSR)
The first graph below compares the TSR of Rightmove's shares against the FTSE 250 Index and the FTSE 350 Index for the
three-year period from 1 January 2014 to 31 December 2016. TSR is the product of movements in the share price plus
dividends reinvested on the ex-dividend date. TSR provides a useful, widely used benchmark to illustrate the Company's
performance over the last three-years. Specifically, it illustrates the value of £100 invested in Rightmove's shares and in
the FTSE 250 Index and the FTSE 350 Index over that period.
As required by the Act, the Company's TSR performance is required to be shown against a recognised broad-based share index.
The FTSE 250 Index was previously chosen as the comparator because Rightmove was, and continues to be, a constituent of
this Index and it was therefore also the Index used historically for the purposes of measuring relative performance for PSP
awards. From 2016 as Rightmove continues to be ranked towards the top of that Index in terms of market capitalisation, it
was felt to be more appropriate to use the FTSE 350 Index for the purpose of comparing TSR performance and therefore this
will be used as the criteria applied to 25% of the PSP awards to be granted in March 2017.
The graphs below illustrate, for statutory purposes, the TSR of Rightmove's shares against the FTSE 250 Index and the FTSE
350 Index for the three and eight years to 31 December 2016.
TSR Graph - three years
Please refer to the pdf
http://www.rns-pdf.londonstockexchange.com/rns/7347X_-2017-2-23.pdf
TSR Graph - eight years
Please refer to the pdf
http://www.rns-pdf.londonstockexchange.com/rns/7347X_-2017-2-23.pdf
Total remuneration for the Chief Executive Officer
The table below shows the total remuneration figure for the Chief Executive Officer over an eight-year performance period.
The total remuneration figure includes the annual bonus and long-term incentive awards that vested based on performance in
those years.
Year Executive Total single figure£ Annual bonus outturn (% of maximum) Long-term incentive outturn
(% of maximum)
2016 Nick McKittrick 2,126,923 92% 100%
2015 Nick McKittrick 2,300,349 100% 100%
2014 Nick McKittrick 1,599,610 70% 92%
2013 Nick McKittrick 2,199,3351,531,515 85%n/a 100%100%
Ed Williams(1)
2012 Ed Williams 2,219,882 90% 100%
2011 Ed Williams 4,934,942 100% 100%
2010 Ed Williams 652,800 100% -(2)
2009 Ed Williams 627,641 100% -(2)
(1) Ed Williams was Chief Executive Officer until his retirement on 30 April 2013. Nick McKittrick was appointed Chief
Executive Officer at this time.
(2) The table above includes share-based incentive awards in the period that the associated performance conditions,
excluding service conditions are satisfied. Certain pre-float share option awards prior to 2006, which had only service
conditions and no performance conditions would have been included in the single figure remuneration table in the year of
grant in accordance with Schedule 8 of the Act. The table above therefore excludes £4,151,532 and £2,026,674 of awards with
no performance conditions, which vested in 2010 and 2009 respectively.
Directors' remuneration (audited)
The information included below up to and including page 82 is audited.
The remuneration of the directors of the Company during the year for time served as a director is as follows:
Fixed pay Performance related pay
Salary/Fee Benefits(1) Pension Fixed pay subtotal Annual Long-term incentives (PSPs)(3) Performance related pay Total remuneration in 2016
£
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